The Pension Protection Act of 2006, which passed the U.S. House and Senate by wide margins, was signed into law in August. Most significant for qualified exempt public charities, such as Speare Memorial Hospital, is a provision which allows individuals age 70.5 and older to make charitable donations of up to $100,000 from an IRA without having to count the donation as taxable income.

At age 70.5 individuals who have IRAs are required to start taking Required Minimum Distribution (RMD) withdrawals which are counted as income and taxed as such. The new law allows the individual to give (rollover) from the IRA directly to the charity, and not have to count the amount as taxable income. This rollover to charity meets the RMD, without resulting in a tax increase.

The requirements to be a qualified IRA charitable gift include:

1. The IRA gift must otherwise have been counted as ordinary income to the IRA owner;
2. The IRA owner must be 70.5 or older;
3. The gift must be to a qualified exempt public charity; and
4. The recipient can not be a private foundation, supporting organization or donor advised
   fund.

This means that Speare Memorial Hospital is a perfect recipient for those end of year IRA rollovers. Remember the donation must be made directly from the IRA to the charity and not to the individual owner in order to avoid counting the rollover as income.
If you have specific questions about making a rollover to Speare Memorial Hospital, please contact the Development Office at (603) 238-2211.

This information should not be construed as tax advice. Individuals should consult with their tax advisors prior to making an IRA rollover.

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